Average weekly earnings rise by 4.7% as workers seek real wage catch-up

Average weekly earnings in the Irish economy rose by 4.7 per cent to €969.12 in the 12 months to the first quarter of this year, according to the Central Statistics Office (CSO). This was up from €925.44 in the first quarter of last year.

The annual increase was slightly elevated on previous years, up from 4.3 per cent in the first quarter of last year and 3.6 per cent in the first quarter of 2019. The pandemic years of 2020, 2021 and 2022 saw big compositional changes in the Irish labour market and therefore give rise to misleading comparisons.

The latest findings suggest that wage growth here remains relatively strong (average hourly earnings rose by 4.5 per cent to €29.82 in the first quarter) as workers seek compensation for the fall-off in real earnings during the recent inflationary surge.

European Central Bank (ECB) policymakers are concerned that elevated levels of inflation in the services sector are being driven by wage demands.

The CSO data confirm that the best-paid workers in the State were once again those in the information and communication sector, with average weekly earnings of €1,786.80, up more than 8 per cent on an annual basis, and more than two-thirds ahead of the national average.

Workers in the construction sector saw their average weekly earnings rise by 8.5 per cent to €961.97 while employees in the arts, entertainment, recreation and other service activities sector saw their average weekly earnings rise by 8.9 per cent to €648.95.

Workers in the accommodation and food services sector were the worst paid in the State, with average weekly earnings of €442.53, but the sector includes many part-time staff.

The figures also showed that the job vacancy rate, a measure of slack in the labour market, was 1.1 per cent in the first quarter, lower than the 1.4 per cent recorded in the same period last year.